Examine the horrid underbelly (overbelly?) of humanity. Those who wish to learn more about the Ruling Elite, their makeup, their plans, their practices, meet the Rothschild family of kingmakers and bank puppeteers. See the MS Powerpoint slide show (CLICK HERE).

"In times of change, Learners inherit the Earth, while the Learned find themselves beautifully equipped to deal with a world that no longer exists."- Eric Hoffer (message is to prepare for vast changes with different platforms and power structure)

"Now consider who would want to take the risk of a country's debt when there is no manufacturing within its border." - JB Slear

PRELUDE TO CRISIS

◄$$$ A NOTE ON FORMAT THIS MONTH, AND ANOTHER PERSONAL THREAT RECEIVED. $$$ The Hat Trick Letter has opted for a slightly different setup this month. This is the initial DISASTER month, the opening salvo of the global BREAKDOWN in the USDollar systems, stretched for months on end in vulnerability. Foreign opposition has had almost a full year to prepare for its ruinous second chapter, the first chapter being the BUST of Lehman Brothers, the nationalization of Fannie Mae for its mortgages and credit derivatives, and the nationalization of American Intl Group (AIG) for its insurance and credit derivatives. So a preview of the BREAKDOWN from numerous angles is presented. Regret is shown publicly for permitting the Lehman failure, but it was necessary in order to send a $138 billion slush fund payment to JPMorgan in the pre-dawn maneuver. All roads lead to the cliff's edge. In the first chapter, the USDollar reacted favorably in what could be called the ‘Dollar Death Dance' but in this second chapter, the USDollar will find no favor. Foreigners have dismantled many levers to assist the USDollar in this round. Rather, it will find more emphatic global rejection. Great non-linear disruptions are coming. It is possible that the price of gold might not be clear in coming weeks or months. A divergence between broken paper price discovery systems (like COMEX) and actual large private transactions could easily grow and create a rift, a huge gap.

Unfortunately, the Jackass got threatened again, this time clearly by a USMilitary guy out of uniform in an unmistakable warning given in a public park in San Jose Costa Rica here on a Saturday afternoon. He likely was dispatched to deliver a message from the syndicate, or had noticed monitors of my telephone calls. This is the first personal threat received in Costa Rica. The last threat came at a gold conference in Munich Germany in November 2006, one month before my arrival in this semi-paradise land. His message was to be careful about what is discussed and written regarding a certain very serious topic that is over-arching in nature. This aggregate concept will not be discussed, but the individual pieces will be covered still. The syndicate is losing control, without a doubt. The longstanding US-UK alliance is breaking down in unmistakable fashion, even as creditor resistance is turning to multi-faceted global revolt. Foreigners react to US chronic broad hegemony, visible bank fraud, credit abuse, veiled aggression, and endless propaganda. The credit masters have moved in new defensive ways to protect their domains, which has the practical effect as offensive strikes on the global chess board. The opposition forces to the US-UK alliance are working to dismantle the vast control levers. The Jackass now has three forbidden topics to avoid in public and private writings. MESSAGE HEARD!!! However, an entire universe remains as fertile ground for reporting. Obviously, the taboo topics will not be listed.

◄$$$ THE RULING ELITE DESPISE THE INTERNET, SINCE IT IS A SOURCE OF TRUTH (SURELY MANY GAMES AND ZANIES TOO). $$$ The Ruling Elite have miscalculated when it comes to the Internet. It undermines the major media messages. Bob Chapman of the International Forecaster said, "The Internet is the Elitists' biggest nightmare. The people are getting the truth and the Elite do not like that one bit. Already a full generation has grown up with the Internet and their educational experience is a good deal different than yours or mine. There are literally millions of pages of information out there on the blogosphere that you simply could not find in your local library. But it is even broader than that. All that information is being translated into action, into broad political movements and Tea Party protests that are going to make it even more difficult for a full level of globalism to be realized. In the 20th century, it was a good deal easier. But in the 21st, things are far more difficult."

◄$$$ A LOUISIANA TALK SHOW HOST WARNS OF THE POTENTIAL FOR PUBLIC RIOTS, WITH ANGER FROM WHITES AND BLACKS SPILLING OVER, AS THEY FEEL BETRAYED BY THE USGOVT AND BANKERS. $$$ James David Manning (PhD) is author of the "The Oblation Man" book. He harshly criticized what he calls the ‘Long-Legged Mack Daddy' as he refers to President Obama, implying he is a bought & sold politician, compromised fully by Wall Street. Manning goes on for over 20 minutes in very colorful style, railing on everything under the sun for national disgust, disappointment, and anger. He expects an eruption in America, next to pour onto the streets. His diatribe would be highly charged racist except it comes from a black Lousiana author and radio show host. By the way, a Mack Daddy is a pimp promoter for prostitutes. See the LA-Gun video clip (CLICK HERE).

◄$$$ MAX KEISER DELIVERS YET ANOTHER BROAD MESSAGE OF WARNING. $$$ Keiser delivers a broad message on current conditions in the global crisis. He actually starts out complimenting the Jackass for coverage of the Chinese role in the reworked architecture of the global currency grid, in particular the concept of the USGovt Yuan Bond. He denigrates the US stock market rally, as being the result of a sugar fix, investors suffering a sugar high. Much federal prop has been directed to support stocks. He cites a $20 to $30 trillion federal deficit if one bothers to include the fact that the USGovt has been putting out credit derivative fires in a huge way. He fully expects a USDollar plunge, with the extreme devaluation coming on the back end of the forced US bank holiday, which is a euphemism for emergency shutdown. He closes by castigating Goldman Sachs, which he believes will not be able to further extort from the TARP funds again. My view is that such a conclusion regarding GSax is very premature. See the YouTube video (CLICK HERE).

◄$$$ TOWN MEETINGS ERUPT, TEA PARTIES COME IN SEPTEMBER, AS CIVIL CONFLICT GROWS. $$$ The national Town Meetings appear designed to sell to the population the national health program. My opinion is that Town Meetings are designed instead to foment civil strife and encourage violence, to detract from anger towards bankers. They are the site of numerous ugly conflicts, and even rude nasty exchanges directed against members of USCongress. Some phrases have emerged, as the Green Shoots of a contrived USEconomic recovery are being called AstroTurf, the artificial grass with non-existent root systems. An important transition is occurring, as the growing national animosity toward the banker Elite by the people is slowly being turned into basic serf bickering and racial conflict. Violence has been seen in a few cities at Town Meeting sites. The Service Employees Intl Union (SEIU) is all too present at the public gatherings. They share office space with Acorn, the national organization that enrolled millions of black Americans for the vote. The open scuffles and fights have come with aggressive black men in SEIU shirts, locked in conflict with unruly white people who oppose the USGovt health care program. The civil conflict against bankers in my view is being intentionally turned into a racial battle, as the Elite wish, and as warned by me several months ago. So we see brown shirts (nazi emblem) on black men. Their objective in my view is to redirect the Tea Party opposition to crooked bankers and predatory mortgages.

The Town Meetings are on the verge of erupting, as they expose deep anger and distrust in the USCongress by the people. Open accusations of fraud and distrust are heard. Members of Congress are losing their composure, and being drawn into scuffles. Never before has any issue been pushed into active sell mode upon the US population, mobilized into hundreds of Town Meetings. The health care program is not essential at this time, overdue a decade or two ago. One can only conclude that the USGovt wishes to foment civil strife and conflict. The upcoming violence sure to spill onto US cities and streets will be at a much higher level than is anticipated. Publicity of Town Meeting conflict assures it. The disappointment of job insecurity and lost life savings and broken homestead dreams is incalculable. Compare Third World violence (lesser) to Industrial World (worse), in what comes. All across the United States and Europe, violence and riots will be breaking out soon. If one looks closely, signs can be seen that authorities are pulling the levers and pushing for accelerated violence. One good sick effect about a growing racial war is that if a class war against bankers looks unlikely, the viruses might remain in the CIA labatories at Fort Dietrich in Maryland, where they were developed.

Anyone who believes the US people will rise up against a general intrusion in their lives, corruption of their money, syndicates having taken control, news turned into propaganda, and contamination of their food, hopes for much. Any resistance against vaccines will require an organization and mentality that is not present yet. My expectation is the majority are disgusted, and find a convenient Lightning Rod in the Health Care program proposals for public venting and grand outbursts. The Tea Parties are a start, but they are small in scope in the scheme of things. Here is a list of assaults on Americans by corporations and government alike, none of which resulted in a groundswell of heightened response. Consider: Wall Street mortgage bond fraud. Goldman Sachs confiscations and insider trading. Chronic regulatory body collusion. Banks receiving TARP funds ordered not to lend to Main Street. The 911 attacks as inside job with demolition of World Trade Towers when 2000 people were in upper floors ($100 billion grand bank heist). Pentagon attack by missile to halt Pentagon $2.3 trillion missing funds investigation. War spending for endless phony war to support a narcotics syndicate. USGovt takeover by narcotics sydicates. Presidents who are narcotics addicts and dont submit public medical records. Supreme Court movement to nazi tactics like search & seizure, easy probable cause, and more. Bribery of Congressional members by lobbyists. Aspertame poison (Nutrasweet bought FDA approval). Prevalent corn syrup. Constant bombardment of beer and drug commercials on television networks. Onslaught of a fascist tilt in confrontational television journalism, when not reporting the public crime of the week. Cap & Trade nonsense as tax during recession. False economic statistics every month. Low Social Security cost of living adjustment increases. Tea Party demonstrations with swine flu virus immediately following to suppress public gatherings. Predatory mortgages and home foreclosures. Pension wreckage from investment trends. Increases in property tax to support bankrupt cities/towns during home price declines. Poor quality of public education for decades. Jobs in industry shipped to China since 2002. Gun laws to restrict ownership. Grand impositions at airports (shoes, liquids, long lines). Car industry wreckage with entire supply chain. Near 0% savings interest for CD deposits. Refusal on small business loan applications by banks. Be sure to know that a few dozen other items were overlooked. Some listed events are my perceptions, based upon scattered but reliable sources too numerous to mention.

◄$$$ CLUNKER CAR PROGRAM ENABLES USGOVT COMPUTER DATA DUMPS. WORSE, THE COST PER CAR IS SOMETHING LIKE $43K IN SUBSIDIES, A GRAND INEFFICIENT JOB WELFARE INITIATIVE EMBRACED BY ALL. $$$. Glen Beck of FoxNews exposes a USGovt website that allows federal agencies to copy every single file on your computer hard drive if you log on. The USGovt can then release the information to anyone from anywhere with implicit permission. The Privacy Act & Security Agreement on the Cash for Clunkers program website is designed to encourage people to turn in older vehicles for new more fuel efficient vehicles. Beck cites from the USGovt website, "This application provides access to the Dept of Transportation CARS system. When logged on to the CARS system, your computer is considered a Federal computer system and is the property of the US Govt. Any or all uses of this system and all files an this system may be intercepted, monitored, recorded, copied, audited, inspected, and disclosed to authorized CARS, DOT, and law enforcement personnel, as well as authorized officials of other agencies, both domestic and foreign." That is a Big Brother warning. See the YouTube video (CLICK HERE).

◄$$$ MAJOR SCANDALS COMETH. THE PRIMARY POINT OF VULNERABILITY IS THE NARCOTICS TRAFFICKING, MONEY LAUNDERING, AND BANK COMPLICITY. $$$ September and October should prove to be super-charged with events unfolding, gradually recognized. The grapevine of connected communications has been mentioning a major upcoming historical scandal from US soil planned for exposure in the coming weeks or months that involves an ex-USPresident, major US banks, and US security establishment, possibly linked to the Mexican Govt. Its magnitude is reportedly in the hundreds of billion$, maybe trillion$. That would put it as multiples greater than the Madoff Scandal, and on par with the Wall Street bond fraud (still unprosecuted). Details are lacking, but in my view that spells Papa Bush, narcotics trafficking under USMilitary cloak, and money laundering with possible aid of Calderon south of the border, spanning more than two decades.

The public is somewhat oblivious, if not blind, to the avenues of infiltration of narcotics by the USGovt security agencies into the United States, where it has organized crime middlemen and distribution channels. The top of the crime syndicate is the USGovt itself. Three main channels are 1) offshore rigs from the Gulf of Mexico as supply depots, 2) soldier coffins from Afghanistan, and 3) defense contractor corporate jets. In February 2008, the Jackass watched the Super Bowl sitting next to a Grumman engineer. He went on during the entire extended halftime show explaining the corporate jet supply method of narcotics transport, which sidesteps the US Customs inspection process.

◄$$$ SOON TO HIT WILL BE A MAJOR SCANDAL ON CREDIT DERIVATIVES, WARNS THE MADOFF WHISTLEBLOWER. HE WAS IGNORED BEFORE AND WILL BE IGNORED AGAIN. $$$ Important, significant, and broad practices of financial fraud are being committed in the credit default swap market. New credit derivative scandals will make Bernie Madoff's $65 billion fraud ‘look like small-time' in the words of Harry Markopolos. He tried to warn federal investigators of profound fraud by Madoff a few years ago, but was ignored. Some wonder why. The reason is that Madoff is part of a pervasive gigantic USDept Treasury and Bank of England longstanding fraudulent structure that has magnitude in the trillion$. Also, the location where Madoff hid his stolen funds is Israeli banks, both inside Israel and with branches inside Switzerland, where they are protected by Swiss Anti-Semitism laws. Madoff is a pawn in a bigger game, who crossed his masters. The benefit to Israeli banks is equivalent to several years of USGovt foreign aid grants. The warnings delivered by Markopolos will be ignored for the same reason. US financial operations are dominated by Goldman Sachs and the Wall Street firms. They are the primary perpetrators of CDSwap and other credit derivative fraud. The USGovt operators will neither investigate nor prosecute themselves.

Markopolos spoke to a Southampton church crowd in New York. He predicted major scandals will soon be revealed about the unregulated $600 trillion market for credit default swap contracts. Raising awareness, he said "To put it in simple terms, it is like buying fire insurance policies from five different insurance companies on your neighbor's house, and then burning down the house." Heck! It remains unclear whether he is personally aware of specific frauds, which he could later disclose publicly, or that he is very familiar how the market works. Regardless, expect Mary Schapiro of the Securities & Exchange Commission (SEC) or Gary Gensler of the Commodity Futures Trading Commission (CFTC) to do anything, not a blessed thing. They were each hired by the syndicate that controls the USGovt financial ministries. See the Business Insider article (CLICK HERE).

◄$$$ THE NATIONAL GUARD ADVERTISED FOR INTERNMENT CAMP JOBS ON MONSTER.COM FOR THOSE WHO WISH TO PARTICIPATE IN MARTIAL LAW OPERATIONS. $$$ My personal attitude has been that Americans have largely ignored most signals of a vast archipelago (gulag) of prisons whose construction is complete. The release of swine flu virus during the Obama trip with full entourrage in Mexico City in April was unmistakable, but it too was ignored. This job advertisement is unmistakable in your face, which cannot be denied. The camps will be filled by those displaced from the USEconomy by job, home loss, and bankruptcy, as well as those possibly who resist forced swine flu infestation (errrrr, vaccination). Perhaps only when the society begins to fray and fracture, when handguns are removed from house to house searches, when jobless demonstrators are arrested, when forced vaccinations are refused, will the people truly awaken. Do not the expect the major news networks to shine any light on the Internment Camps. But the following job offer on Monster is rather stark and clear.

Job Title: Corrections Officer - Internment/Resettlement Specialist (USArmy National Guard). Job Description: As an Internment/Resettlement Specialist for the Army National Guard, you will ensure the smooth running of military confinement/correctional facility or detention/internment facility, similar to those duties conducted by civilian Corrections Officers. This will require you to know proper procedures and military law; and have the ability to think quickly in high-stress situations. Specific duties may include assisting with supervision and management operations; providing facility security; providing custody, control, supervision, and escort; and counseling individual prisoners in rehabilitative programs. See the Monster website job in full glory (CLICK HERE). Oops!! The National Guard job advertisement has been removed. Apply now. Refine talent, reveal character, realize potential, they say. Brown shirts are optional! If you believe people will be cared for in these facilities, you are a moron. Military law reference means martial law.

◄$$$ UNDERSTANDING CHINESE STRATEGY REQUIRES A VIEWPOINT AS A GRAND FISTFIGHT WHILE WRECKING EACH OTHER'S HOUSE WITH POWERFUL KICKS. $$$ The Chinese factor will continue to turn everything upside down. The US press networks pretend to understand the Chinese influence, but they probably do not in the slightest. The financial market makes it like the Chinese are pushing for a Strong USDollar, but they are not. They make the Chinese out to be vulnerable to US$-based asset loss, when they are willing to accept costs for geopolitical change. A weak US$ means China can secure a seat at the global banker table. They are playing the USGovt ‘game' by telling the Americans what they want to hear, and confusing them at every turn. Both sides talk about preserving the USDollar and USTreasury Bonds. Instead, a great war is underway, to push the US off the primary seat of bank power and for the Chinese to take a big seat at the same table. This is a war for global control ulimately. They absolutely CANNOT talk like that in public. Doing so would disturb the equilibrium, where people work and pay taxes and invest funds.

Tremendous espionage is occurring at the same time. The Chinese are stealing weapon systems when they are not buying them. Behind the scenes the Chinese are dumping tens of billion$ in USTreasurys. They are feverishly trying to unload as much of their acidic USTreasurys as possible. The Chinese are fighting a very delicate war. When they criticize the Americans, they do so in ways expected for criticism. The main plan is to attack the many US weaknesses, but to attack without making it clear that they are attacking, but rather acting in China's own interest or in a practical manner. They use the principles of the book "The Art of War" by Sun Tzu, a great classic. The plan is to have the Americans destroy themselves and to enable the process with efficiency. They accomplish that tactic well, and with great patience. The Chinese angles are the distinguished principal factors in the financial world today, namely the US$-based global financial grid. Many people fail to realize it, and focus on the US consumer, USGovt programs, and open trade. These really serve as endgame symptoms. The Chinese are in control to a increasing extent, along with other creditors. The Chinese are the most active, intrusive, critical, and angry among them. They attack the global foundation structure of the USDollar, not so much with the practice of its usage in banking reserve systems, but in usage in international transaction settlement. This ‘Bottoms Up' approach undermines the US$ from a practical angle. It will prove to be highly effective, like ruining a big dining room table by destroying one or two legs.

◄$$$ THE WEAPONIZED FLU VIRUS THREAT HAS NOT GONE AWAY. IT HAS A COORDINATED PLAN, BY ALL APPEARANCES. STAGE #1 VACCINE INVOLVES WEAK LIVE FLU VIRUSES OF TWO TYPES, LACED WITH MERCURY POISON. WHEN THE TWO TYPES MEET IN SOCIETY, THEY COMBINE TO FORM A LETHAL FLU VIRUS MUTATION. THE STAGE #2 VACCINE INVOLVES AN ENZYME SQUALENE THAT ENCOURAGES MUTATION. THE POWERZ SEEM BY ALL INDICATIONS TO PURSUE A GLOBAL SPANISH FLU LIKE 1915. $$$

No vaccination should EVER include live virus, but rather only dead virus. That is the starting point. The vaccination program has evidence that vaccines contain mercury (in form of thimerosal) which is known to damage the brain function. Most flu vaccination shots contain mercury, but few know it. Tens of millions of Americans are expected to receive innoculation against (or injection of) swine flu this season in hopes of protection against the nasty virus. However, more than 80% will also get what some say is a hefty and dangerous dose of mercury. Experts claim the vaccine benefits outweigh potential risk, but one must wonder in today's day & age. The US Centers for Disease Control and Prevention recommends that almost everyone, including pregnant women, receive the innoculation, despite written warnings from the vaccine manufacturers. See the Natural Health Blog article (CLICK HERE), or the Center For Disease Control questions & answers about thimerosal (CLICK HERE).

Authorities admit to vaccines containing thimerosal. The majority of influenza vaccines distributed in the United States currently contain thimerosal as a preservative. However, some contain only trace amounts of thimerosal, still considered by the Food & Drug Admin (FDA) to be preservative-free in a blatant denial from expedience. Manufacturers of flu vaccines use thimerosal early in the manufacturing process. The thimerosal is diluted as the vaccine goes through the steps in processing. By the end of the manufacturing process, enough thimerosal remains in the vaccine to act as a preservative but the vaccine is still officially labeled preservative-free. Giving a 3-year old child the flu vaccine would raise the blood level of organic mercury beyond what the CDC has defined as a chemical poisoning. The recommended USGovt schedule requires that this dose be given twice, one month apart. See the Journal Sentinel article (CLICK HERE).

An orchestrated complex plan seems clearly underway to disseminate swine flu to the US population. The process has two steps. The first stage involves the spread of two weak swine flu types, which will certainly meet each other in the population. When they do, they will combine to form a more deadly flu strain, putting the lives of both parties in grave jeopardy. The second stage is actually intended to encourage that mutation, while introducing a more powerful live flu strain. On its face, this seems like premediated genocide. My research cannot find any strong evidence to the contrary. The mercury poisoning is anticipated to weaken the human immunity systems. Some believe the second stage is intended to deliver a stronger live flu virus to people whose systems have been weakened not only by mercury but also by the active flu from the first stage. People who do not participate in the process stand the best chance of survival. Investors and executives at the major pharmaceutical firms stand to profit in an outrageous way, which could result in their rise in global political power. The collusion among pharma firms, the CDC, and USMilitary has been well documented to produce a virus as a weaponized microbe. The CIA laboratories are located at Fort Dietrich in Maryland, where many other microbial weapons have been developed and are stored. Bear in mind that a combinant virus from human, swine, and bird is a natural impossibility. It can only be produced in a laboratory. The public is told that the vaccines are intended to be as powerful as possible for protection against different flu types. Actually, the same development process can be designed for genocide. See the Bilderberg chronicles for discussion in their meetings for virus release and global population reduction.

◄$$$ THE ROCKEFELLER EUGENICS PLAN IS MOVING ALONG. READ AND DECIDE FOR YOURSELF. THE PRISON PLANET IN MY VIEW IS HOST TO MANY STORIES, PERHAPS 10% TO 20% TO INCLUDE HYPE, BUT A SURPRISING AMOUNT TO CONTAIN INFORMATION THAT TURNS OUT LATER TO BE ON THE MARK. $$$

Senator Jay Rockefeller denies his role and relationship. But his older brother is a mastermind of numerous sordid movements directed against humanity. They are unfolding this year finally, tragically. See the Prison Planet story (CLICK HERE).

BANK SYSTEM SHUTDOWN COMMENTARY

◄$$$ AN UPDATE ON THE POTENTIAL US BANK SHUTDOWN. THE TRIGGER EVENT MIGHT BE THE 2ND QUARTER F.D.I.C. OFFICIAL REPORT, WHICH SHOULD CONTAIN A LIST OF 500 TO 1000 TROUBLED BANKS SOON TO FAIL, AND STATUS OF ITS NEARLY DEPLETED FUND. RELEASE IS SET FOR TUESDAY AUGUST 25TH. MORE DETAILS INCLUDE A PLAN TO FEDERALIZE POLICE & HOSPITALS NATIONWIDE. TALK SWIRLS AMONG MILITARY SOURCES OF A POSSIBLE USMILITARY COUP THIS AUTUMN, WHICH WOULD PRESERVE SYNDICATE POWER AND KEEP FOREIGNERS OUT. THE BANK HOLIDAY IS A PRELUDE TO USTREASURY DEFAULT. $$$

Jim Sinclair passes along information about national controls planned. He adds to the weight of Harry Schultz on the story. The following captures his message (with my added editorial comments). From an internal reliable source, a person caught a glimpse inside a police station of a FEMA presentation. The plan is for the USGovt to federalize the city police departments and urban hospital systems. The plan is for a scheduled US bank system shutdown. The urban centers will be subjected to roadblocks and checkpoints on major roads, but not the rural areas. Urban center major stores and supermarkets will operate with a system of vouchers, a clear rationing of staples like food and gasoline. Some gun confiscation will also take place, possibly with door-to-door searches. This is a precursor to imposition of martial law in the United States, or at least from a state of declared emergency. After the banks close, people will not have access to their money, sure to cause civil disturbances. The challenge will be to obtain food and gasoline, and reach the homes and workplaces. Also, the emergency rooms at hospitals in major cities across the country are expected to be overloaded. People will grow desperate, as many will find themselves with little alternative, as they are largely out of work with credit lines cut off. This is true apart from the swine flu epidemic in its early stage, a planned, designed, propagated initiative in genocide. Referring to the Harry Schultz newsletter (HSL), he said "Conclusion: Stand by for a possible bank run & bank holiday on Aug 26th, after the news breaks on the 25th (from the FDIC 2nd Quarter Report). This is in line with the HSL prediction of a US bank holiday in August or September. If you live in the United States, obtain 3 to 6 months household expense money out of banks now." The FDIC report could reveal the worsened insolvency of the US banking system generally, causing major ripple shock waves, revealing their broken condition. A number of US Embassies have been instructed to load up on local currencies. Either US banks will not be available to dispense USDollars, or perhaps foreign sources may not accept USDollars. See the YouTube video with details that shows Chad from the ‘Change the Change' campaign to warn individuals (CLICK HERE).

Some USMilitary sources have begun to report an upcoming military coup against the USGovt. Such an extreme event would preserve the power domestically, and eliminate any potential of a bankruptcy receivership tribunal by foreigners to take root. Such a tribunal would have the power to dissolve the USGovt and replace executive management. A coup would permit the syndicate continuation of power under military rule, and retain domestic control. It makes sense. Liberties would vanish. Strict laws might be instituted, like for curfews and rationing if civil strife broke out. The likelihood of a Coup d'Etat grows mainly if a USTreasury default looms as a certainty, since that would introduce the foreign-led tribunal. The first task of any tribunal would be to dissolve the USGovt and replace it with a management committee, probably region by region for efficiency. Reports from two sources indicate tremendous internal battles in progress right now within the Central Intelligence Agency. It pits the New Young Guard with designs on power with compromise of law versus the Old Guard with defense of truth and honored Constitutional law. It is essentially Fascist Generals (New Young Guard) loyal to the narcotics syndicate pushing out Constitutional Generals loyal to the republic. A case in point is the USMilitary and Security Agencies are funded by USTreasury Bonds. In a very real sense, a bonafide Coup d'Etat occurred in September 2001 with little recognition. Its birth pangs were ensconced in 911. A coup could be done by either side, so nobody knows whether the syndicate is to be entrenched deeper or to be pushed out. My view is that plans are surely in place, but execution of plans is unclear.

◄$$$ INTERPRETATION OF THE TIMING AND RISK, WITH SCHEDULED EVENTS TO CONSIDER LEADING TOWARD A SYSTEMIC BREAKDOWN. A MASSIVE JUGGLING ACT HAS ENDURED FOR MONTHS, WITH THE RISK OF ACCIDENTS RISING EXPONENTIALLY, LEADING TO INEVITABLE EVENTS. AN IMPORTANT CULLING OF ROTTEN ELEMENTS IS SET TO BE DONE, PERHAPS SUDDENLY, AND ONE MUST HOPE EFFECTIVELY. A CAREFUL LOOK SHOWS SEVERAL KEY SIGNALS. $$$

It is my belief that a first bank holiday will last only 3 to 5 days. It could serve as a trial event, my guess. Later it will become clear that the USTreasurys have technically defaulted, that the US bank system is indeed dead, and the supply of USDollars will be impossible to maintain. Then comes the scary longer bank holiday, later on, unsure when. Do not be fooled by the end of the first shutdown. The second shutdown might endure for 30 to 60 days, maybe 3 to 6 months. Nobody really knows. The USDept of Homeland Security is trying right now to federalize all city and state police organizations. FEMA will take a key role if and when killer viruses are released.

Five different important angles are pointing to the last week of August as time frame for events triggered. They are the following: 1) FDIC report of US bank conditions on August 25th, including lists of near dead banks. The list is reportedly to contain 500 to 1000 banks, whose failure will send the FDIC fund deep in the red. Appeals to the USCongress for more funds will find heated debate. 2) USCongress convenes after the August recess. Members will begin to appear more responsible, resulting in some deadlock and refusal to fund Wall Street channels even as US Federal Reserve channels suffer from natural constipation. 3) Defense of the US-UK financial platforms and systems will reach a crescendo due to lacked staff as the vacation season comes to a climax end. Attacks are inevitable during this time of reduced fortress staffing. 4) USCongress must decide by September on extension of the federal debt limit to $12.1 trillion, as requested by the USDept Treasury. Debate could turn into a battle of wills, with accidental impacts the result of funding battles, and possible deadlocks occurring. 5) In 4Q2009, big banks must comply with a reversion of FASB accounting rules to normalcy, where dead assets hidden off-balance sheet are returned to the formally stated books. The FASB rule change, effective April 1st, enabled the stock market rally, all a phony facade and fake foundation. It was temporary.

A highly connected source from the banking world said, "The system is all rigged. The amounts of money that are moving from room to room to put out fires is mindbending by any standard. Sooner or later someone will get caught in the many tripwires that are in this system. Once that happens, all will come apart and tumble down with lightning speed. The system is in a death spiral of an unimaginable proportions. The problem is, once the elephant goes down, it will take everything down connected to it. It will be very, very ugly, with tremendous collateral damage. Only essential assets and precious metals will hold value and even re-price favorably during the system implosion. The crucial moment will be once the numerous diverse major price points hit rock bottom. From there will be a bounce back effect. It will be at this moment when the bad apples need to be eliminated within a split second before all finally comes to rest on the bottom after the implosion. Do not be fooled by the dust cloud that will eliminate visibility for a period of time. In the meantime here, people have a couple of weeks to take strategic positions, to obtain the right shades and a dust mask to protect themselves." Wow! That is plain talk! We must be on the watch for suddenly developing events, then a fast moving surgical removal of evil elements in the culling process. Notice the comment of gold, silver, and platinum holding value and jumping up in price.

◄$$$ A SHOCK WAVE COMES FROM USTREASURY BOND SALES OF HUGE VOLUME. THE EVENT SEEMS COORDINATED BY USGOVT CREDITORS WHO ARE FRUSTRATED AND SEEK A CHANGE IN THE POWER STRUCTURES WITH SOME RESOLUTION. A SHOCK COMES THAT SHOULD CONTRIBUTE TO A FINANCIAL SYSTEM BREAKDOWN. $$$

To further complicate matters, a internal source connected to the bank and gold world with global ties and global clients has informed me that several important major creditor nations are prepared for a revolt of their own against the USDollar and its primary vehicle. These groups are often called the Sovereigns, with whom he has contact with directly. The creditor asset accounts held in the form of USTreasury Bonds, whether official FOREX reserve holdings or Sovereign Wealth Funds under management, are prepared for a massive sale of USTreasurys. In the months of September and October, they are ready to sell several hundred billion$ worth of USTreasurys in order to salvage what they can. It is unclear whether a race to the exits will ensue, or an orderly dumping will take place in an organized global insurrection. Creditor sovereigns are totally frustrated, fuming angry, and fed up, no patience remaining. They want a severe event to change the status quo in the financial structures led by the US-UK, to unseat the Anglos from power. They have stated to the USGovt their concerns about lost valuation, lost integrity, and continued threat of debasement. They are frustrated that not only are USGovt deficits enormous and unprecedented in size, but further expansive programs like Health Care are in planning stages. The creditors regard the US political and banking leaders as living in a world divorced from reality. The hidden topic that exacerbates the creditors is the endless costly war, which might be reaching a climax stage in Afghanistan. The NATO troop tension with the USMilitary is growing exponentially. Extending the war into Pakistan has inflamed the region and allied participants, a symbol being the planned $1 billion USEmbassy in Pakistan.

◄$$$ ON A GROWING BASIS, THE USTREASURY BOND IS BEING USED AS A LIQUIDATION VEHICLE, TO BE MADE AVAILABLE FOR SALE QUICKLY. THE TREND OF DUMPING USTBONDS WORLDWIDE IS GROWING. $$$

USTreasury Bonds are becoming a liquidation currency. Take two regions. The United Arab Emirates is in disarray. The firm prudent responsible Abu Dhabi city state has bailed out the reckless gung-ho construction project city state of Dubai. Tens of billion$ are involved in desperate settlements and rescues. Many Dubai prestige projects were funded with USTreasury Bonds as collateral, which has been largely seized by project creditors. Abu Dhabi bankers will soon be dumping massive USTBonds on the market in order to balance their books and restore financial order after the wreckage. Entire construction projects lie empty without tenants, including the Prestige Projects like the one that displays elegant branches and leaves. In Central Europe, the German bankers are cutting deals to the tune of $6 to $12 billion per month with the Chinese. The Beijing bankers are working feverishly with the Germans to cover the vast sea of bad debts from Southern Europe, as in the PIGS nations. Debts from Portugal, Italy, Greece, and Spain have accumulated into mountains of bad debts, that even extend to Ireland. The Chinese are buying up the PIGS sloppy debts, laying down USTreasury Bonds as carpetbagger funds used in the grand purchases. The Chinese are demanding broad arrays of European industrial property, diverse standing manufacturing plants, and vast equipment. The Euro Central Bank is the official manager in the restructure negotiation, holding bad PIGS debts. The Germans are the broker. The Chinese are the buyer. When the deals are completed, Europe will be loaded to the gills with USTBonds, ready to dump. European Union balance sheets are being remedied, with vast USTBonds brimming in supply, awaiting dumping events.

Never overlook the continued China acquisition of numerous African and South American companies, properties, and projects. They are securing commodity supply, while financing vast infrastructure development (like port facilities and railroads), even at times schools, hospitals, community centers, and transportation systems. They are laying down USTreasury Bonds oftentimes as currency. The African and South American nations will not be building deep savings accounts, but rather spending their USTBonds obtained in the transactions. THE WORLD IS SOON TO BE EVEN MORE AWASH IN USTREASURY BONDS, WITH HOT HANDS UNWILLLING TO HOLD THEM. Simon Black (aka The International Man) reports on the Chinese urgent initiative to ‘spend' their USTBonds quickly, for useful tangible purposes. He wrote, "I have been spending a lot of time this week talking to my sources in China, one of whom is inside one of the country's sovereign wealth funds (SWF). He also indicated that the SWF analysts were working around the clock trying to put deals together. For China it is a race against the clock for how fast they can convert their $2 trillion in USDollar holdings into strategic assets, namely oil and gold. At today's deflated prices, putting together a really good billion dollar deal is a difficult thing to do. Putting together 2000 of them is impossible. Doing it before the dollar collapses? Not a Chinaman's chance. And they know it."

◄$$$ RISK GROWS FOR A USTREASURY BOND DEFAULT. $$$ The world is near the beginning of the BREAKDOWN. It will result in a USTreasury default. In fact, a default in a technical sense has already occurred as creditors are busily restructuring USTreasury debt NOW!!! They are reportedly trading long-term USTreasury Bonds for short-term USTreasury Bills, which can be redeemed in one to two years. They are also trading with discount their USTreasurys for hard assets, namely industrial equipment, farmlands, energy deposits, mineral deposits, and other hard assets like gold bullion. My eye searches for evidence of default priced in the USTreasury Credit Default Swap.

Three additional stories are worth mention. First, increasing scuttlebutt comes from experts who talk about the USMilitary losing the Afghan War. When the Afghan War publicly carries the perception on the verge of a lost war, watch the USDollar plummet. The USMilitary upholds the USDollar and the narco funds uphold the military.Second, beware of the Stockholm Syndrome with Wall Street bankers and Goldman Sachs entrenched like a cancer. The US public and clean well-meaning portion of the USGovt has a built-in dependence with the tarnished financial crime syndicate. A breakdown in that sick symbiotic relationship is apparent. The conflict has reached into the open arena. See USFed Chairman Bernanke challenged before the USCongress, the USFed challenged for an independent audit, and Wall Street executives berated in Congressional meetings. Third, the House of Representatives reversed the move to upgrade the executive jet fleet after public criticism. Opposition from other legislators was too much. Even Defense Dept stated it did not need more planes than it had requested. See the jet story on Reuters (CLICK HERE).

◄$$$ BERNANKE SUFFERED A COURTROOM CROSS-EXAMINATION IN THE USCONGRESS BY GRAYSON. HE WAS ASKED NUMEROUS DIRECT QUESTIONS THAT EXPOSED THE USFED AS OUT OF CONTROL IF NOT COMPROMISED. GRAYSON BAFFLED BERNANKE IN THE GREATEST CONFRONTATION YET. $$$

Congressman Grayson is not a typical USFed critic. His questions were earnest and straightforward, in an attempt to understand while showing concern for the mammoth interventions the USFed has undertaken in global credit markets. Bernanke explained in direct terms the nature and intent of the interventions. But he lost credibility when he claimed not to know which foreign institutions received USFed funds, leaving himself vulnerable to corruption accusations. His admitted goal to ‘intervene to keep dollar interest rates from going up' is very important, since all interventions must eventually unwind. Imagine what that implies for interest rates in the future. The Green Shoots congame story relies upon a variety of USFed and USGovt props to suppress key interest rates, which is implicitly confirmed by Bernanke. He again lost more credibility when, in response to Grayson, he thought the USDollar exchange rate rally at the same time as outsized USFed intervention was a coincidence. Avoiding a USDollar collapse is Job#1 for the USFed. Lastly, Grayson made some important Constitutional points about the nature and history of the US Federal Reserve, with no objection by Bernanke. See the eye-opening if not alarming YouTube video clip (CLICK HERE).

USTREASURYS IN A JAM, CHINA AS JAILER

◄$$$ USTREASURY BOND DEFAULT IS BEING AVERTED BY MEANS OF BLATANT HIDDEN MONETIZATION IN A REVOLVING DOOR USING PRIMARY BOND DEALERS. EVIDENCE IS RIGHT OUT IN THE OPEN DURING DOMESTIC AUCTIONS, BUT NOT NOTICED BY THE LAPDOG PRESS NETWORKS. REGULAR HIDDEN MONETIZATION HAS BEEN OCCURRING WITH FOREIGN CENTRAL BANK COLLUSION. $$$

This past week a hefty $14 billion in buying activity by the USFed represented newly printed money that was exchanged right away for the federal debt of the USGovt. The USFed used its Permanent Open Market Operations to conduct the purchases, thus these additions of money should be considered as permanent. Auction results were trumpeted as notable successes, with sufficient bid/cover ratios. The previous $39 billion USTreasury auction one week before had witnessed a 1.92 ratio, which means the primary dealers failed to find private bidders to match 8% of the auction volume. A 2.00 ratio is needed as a bare minimum to run a successful auction. It turns out that 47% of the $14 billion in USTBonds that were taken by the primary dealers in last week's auction have been swiftly and secretly gobbled by the USFed and permanently shoved onto its balance sheet. So desperate to avoid a convulsion within the USTreasury walls, they could not afford to wait a full week!

Purchasing the USGovt debt issuance in full auction view by the USFed in open action would have subjected the institution to criticism of blatant monetization. The Chinese abhor such practices, repeated often on the global stage. So the USFed used its primary dealers and Permanent Open Market Operations. The sleepy financial press notices nothing. Chris Martenson has discovered that just one week after issuing $28 billion in 7-year bonds through its broker the USTreasury, the USFed has turned around and bought 47% of the primary allocated bonds in Open Market Purchases. So stories are not consistent, but that matters not at all. The primary dealers purchased $10 billion of these bonds. As Chris Martenson said, "The speed of the shell game is accelerating. This immediate repurchase of newly auction bonds by the Fed tells us that demand for these bonds is not nearly as high as advertised, and that things are not quite as strong as represented… What we have going is a not so concealed USTreasury Bond Monetization Scheme. A schill company buys the USTreasurys at auction only to turn around and quickly sell them to the USFed in order to hide the fact that the Fed was the real buyer." See the excellent forensic analysis on the Martenson weblog (CLICK HERE). Contrast the domestic hidden monetization in auctions to the usage of foreign central banks bidding with USFed provided funds in overseas hidden monetization. Desperation has set in, so as to avert early events leading to a USTreasury default.

Not to be deterred, the USGovt has promulgated propaganda to deflect attention. In late July, a statement was made by Lyle Gramley, former USFed Governor. Apparently, we are told that the US Federal Reserve will halt its purchases of up to $300 billion in USTreasurys in mid-September as scheduled. Gramley said, "They are clearly not going to extend that program given the improvement in financial markets that is going on." This is diversionary information. They will shift their monetization efforts squarely on the new USTreasury auctions, and leave alone scheduled monetization of older USTBonds. In other words, they will ignore the burning basements and focus on the visible burning storefronts. See the Bloomberg article (CLICK HERE).

Despite pressure from the Chinese not to monetize USTreasury debt issuance, the USFed will be forced to increase its monetization of US Treasury debt. It does so with foreign links via their cooperative central banks. It does so by rapid permanent purchase of primary dealer inventory. Nevertheless, consider the wretched USTreasury auction of $39 billion in 5-year Notes from three weeks ago, almost four times a typical entire month from over a year ago. Denninger does the math, which looks much worse than my initial view. The official 1.923 bid/cover ratio records almost twice as much bids as auction supply. The primary dealers had a 61.59% participation in the auction. That means the dealers accounted for 1.18 bid/cover by themselves. It is greater than one. The dealers covered the supply, but in no way could they match their bids with market bids, so as to unload that supply. Without the dealers involved, the auction was close to a failure, since the official bid/cover was below the 2.0 ratio. Under 2.0 means the dealers are NOT matched by actual bidders in the marketplace, thus under-subscribed and a failed auction in a certain sense. That means the primary dealers had to soak up supply themselves, rendering them exposed. That is, until the USFed rescues them with immediate bond redemptions. Primary dealers are required to bid. That is the contract in exchange for their serving as primary dealers. The Treasury auctions are rigged so that the process cannot have official failures.

Denninger concluded as follows. He wrote, "Those who think this [1.92 bid/cover ratio] is ‘no big deal' need to have their head examined. In general any BTC under 2.0 indicates a serious problem, and the perverse nature of the primary dealer system is the reason. The United States Credit Card (issued by China and Japan) is being slowly cut off. That the stock market ‘recovered' after this ridiculously bad auction (bow-wow is the best way to describe it) speaks to the vacuum between the ears of both the cheerleaders in the mainstream media and those in the equity markets. There is only one other time in recent memory that we have had a bond market auction fail like this. You might want to go have a look at your charts, with dates, for what followed shortly thereafter." See the Market Ticker article (CLICK HERE).

◄$$$ THE USFED HAS FORMALLY REINFORCED THE GLOBAL USDOLLAR SWAP FACILITY, JUST IN CASE. IT IS CLEARLY ESSENTIAL IN USTREASURY AUCTIONS, TO ENABLE FOREIGN CENTRAL BANKS TO BID FROM U.S. ACCOUNTS IN EUROS, POUND STERLING, AND YEN. $$$ This story is so obvious. Official statements were made to the effect that "The statement is clearly not tied to any immediate operations. It is mainly pre-emptive." What patent nonsense! They give the public all the necessary ingredients to make conclusions, but people are too distracted by fabled Green Shoots and Health Care debate. See the Bloomberg articles (CLICK HERE1) and (CLICK HERE2) and the Finance Commerce article (CLICK HERE3).

◄$$$ USGOVT ENDS ATTACK ON UNION BANK OF SWITZERLAND, BUT THE REAL FORCE TO HALT THE ATTACK IS DIRECT ORDERS FROM CHINA. $$$ Few seem to connect the timing dots. A large Chinese delegation met with President Obama, and one week later the USGovt ends its little tax war with Union Bank of Switzerland. Since the founding of the Swiss Confederation in 1291, Switzerland has protected the privacy of its financial accounts. It boasts the world's most secretive banking jurisdiction. It furthermore boasts the most independent bullion bankers, protected by bond depositor laws that prevent any information sharing with the Swiss Govt. For more than a year now, this tradition of bank secrecy, or financial privacy as the Swiss call it, has been under attack from the US Internal Revenue Service (tax collectors). In July 2008, the IRS served a ‘John Doe' summons on UBS, an aggressive and very broad sweep attempt to secure records that would identify US taxpayers with UBS accounts. It is the equivalent of a blank check in legal assaults, a fishing rod with a hundred lures attached. They wished to snare those who have not reported these accounts to the IRS. UBS failed to comply with the summons. UBS did agree and did pay a $700 million fine this spring for tax evasion complicity to the USGovt.

In February 2009, the USDept Justice filed a petition to force the Swiss banking giant to turn over some 52 thousand names of US bank accounts suspected by the IRS of not paying taxes on interest earnings. In all, an estimated $15 billion is held offshore by US citizens in secret Swiss bank accounts.To me this entire case smells like vast shifts by Wall Street syndicates have already taken place to Caribbean bank locations, thus move the attack and appear responsible politically. UBS has continued to refuse to disclose the names, arguing that doing so would violate Swiss banking laws (criminal offense, leading to prison), not to mention undermine a primary pillar of the Swiss Economy. Fearing that UBS might yield to US pressure, the Swiss Govt entered the fray in early July to bolster the bank. The Swiss Govt promised to seize UBS bank records if a US judge ordered full disclosure, thus blocking any release of private information. At the end of July, three days before a scheduled trial, the US and Swiss Govts reached a tentative agreement. UBS will not give US tax authorities any names. A totally unrealistic Politics Daily article tells a fraction of the story, with a full bias indicative of mysterious US continued control (non-existent) entitled "US Lets Swiss Banking Giant UBS Off the Hook" (CLICK HERE). The USGovt is only in control of the news networks.

Two major hidden factors are involved, neither ever reported by the lapdog intrepid US press. The Swiss Govt had in response this spring demanded a return of over 1000 metric tonnes of gold bullion held in US custodial accounts, like in New York City. This gold is critical for the gold cartel of US-UK to maintain its price controls of the USDollar, USTreasurys, and Gold. The more the USGovt pushed for tax haven account details, the more the Swiss Govt pushed for return of its gold, some of which is paper certificate after illegal lease and sale by the Anglos. The USGovt was turning this battle into a gold war which the United States could not win, since it has illegally sold much of the Swiss gold, and is a deeply indebted nation on the verge of entering the Third World. Almost zero mention of the gold factor appears in the US press. The other more immediate factor that resulted in actual resolution was the direct effective Chinese Govt pressure. They want the US-UK influence smothered, stifled, and removed. The great creditor can toss its considerable weight around. A well placed gold banker contact with ties to China commented in two notes spaced one week apart. He said, "It is amazing what a 2x4 [piece of wood] in a Chinese hand and beaten over on the US president's head can accomplish in just one day. The Chinese told the BOYZ to back off UBS and to do so immediately. That is what happens when a creditor nation gives instructions to its debtor. On an increasing basis, the Chinese have taken control of the USGovt in key ways… When the Chinese were in town the other week they simply told the President to back off and close the UBS file or else! The US$700 million that UBS was forced to pay to the USGovt is also being returned, at Chinese demand. The Chinese need the Swiss banks to do their gold and silver transactions. There is much more, but this is all I can tell you."

◄$$$ CHINA DEMANDS TWO THINGS FROM THEIR NEW INDEBTED VASSAL THE UNITED STATES, AN END OF QUANTITATIVE EASING (AKA RAMPANT MONETARY INFLATION) AND ENDORSEMENT OF THE SUPER SOVEREIGN RESERVE CURRENCY (AKA USDOLLAR REPLACEMENT WITH FULL EPITAPH). THE USGOVT CANNOT ACCOMMODATE EITHER DEMAND, THUS A FULL BLOWN CONFLICT COMES, CERTAIN TO RESULT IN USTREASURY DEFAULT. $$$

Without any debate, the USGovt requires continued if not increased Chinese Govt purchase of USTreasury debt securities so as to finance the gargantuan US federal deficits. They are exploding, runaway, without prospect of taming in the near future. At the White House meeting, a continuation of the Strategic Economic Dialog with China, China is reported to have made two very important demands, neither of which is remotely possible. They are setting up a USTreasury default with full blame placed on the United States leadership from lack of compliance as a debtor. China demands an end to Quantitative Easing, the rampant printing of money, the unbridled creation of USDollars, used to cover the USTreasury Bonds issued. This inflation endangers the value of the USDollar and could quickly render it a trashed currency. China demands that the United States provide full support for the super sovereign currency, which is actually an Intl Monetary Fund instrument, a basket of major currencies. The super sovereign is the SDR from the IMF. The Special Drawing Rights is desired for both settlement of international trade transactions and securitization of national reserves from trade surplus. Internal reports indicate that the Chinese Govt demands both be agreed upon before the end of 2009. That is your timetable for USTreasury default!!

If Quantitative Easing is brought to an end this year or even in 2010, the interest rates in the United States would zoom past 10% and head toward 15%, maybe even 20%. The result would be destruction of the housing market, ruin of banks that hold mortgages, an economy in a ruinous tailspin, and the uncontrollable explosions from credit derivatives (like Interest Rate Swaps), enough to bring 10 years of darkness to the United States. If a Super Sovereign Currency is endorsed, the USDollar would become just another currency. The US$ would not be used in trade settlements globally, and it would not be held in USTreasury Bond instruments as global reserve accounts. The USDollar would be forced to trade in the FOREX on its own merits, namely as a Third World currency. Its value would drop by 50% at least. Sadly and tragically, no exit can be taken from never-ending monetary inflation to cover debts. Sadly and tragically, no replacement, alternative, or co-existent currency to the USDollar can be endorsed without its death.

◄$$$ CHINA PUSHES FOR THE B-2 BOMBER WEAPON PROGRAM, A BLATANT SIGN OF LOST SOVEREIGNTY THAT DIRECTLY AFFECTS NATIONAL SECURITY. $$$ On April 1st of this year, before the White House visit in July, President Obama spoke to Chinese Premier Hu Jintao during the G20 Summit in London. During their meetings, Premier Hu proposed an exchange of USTreasury debt for military technology, in particular for schematic blueprints of the B-2 Spirit stealth bomber. The President has since referred the matter to Defense Secy Robert Gates, whose entire organization is furious with the proposal to sell the active weapon program to the Peoples Republic of China. Gates rejected the plan outright, but has been order to resign if he fails to facilitate the process.THIS COULD BE A MAJOR POINT LEADING TO A USMILITARY COUP. According to the deal, the USGovt would sell the plans for the B-2, along with radar-absorbing paints and metals in exchange for $50 billion in debt relief. The B-2 project cost the Pentagon and defense contractors $23 billion to develop in the 1980 decade.

According to the Obama Admin, executive officials believe that the B-2 bomber is ‘strategically obsolete' and development into actual functioning stealth bomber fleet would require ‘at least eight years' of time. American longstanding allies in Asia, namely Taiwan, Japan, and South Korea, are very nervous and skeptical of the proposal. Koo Syi is a geopolitical analyst from South Korea. He points out that this technology could be passed to China's allies, with established precedent from the past. See the cases when Chinese nuclear technology was transferred to Pakistan and North Korea. In the viewpoint of Koo, Obama has rendered the opinions and strategic concerns of US allies as ‘irrelevant.' THIS COULD BE A MAJOR POINT IN SUPPORT OF A USMILITARY COUP. Despite the controversial nature of the proposal, the USCongress will not have an opportunity to discuss or debate it. Instead, the State Dept has been informed to assist the Defense Dept with the complete transfer. See the Turner Radio Network article (CLICK HERE).

GOLDMAN SACHS & HALLIBURTON PRIVILEGED

◄$$$ GOLDMAN SACHS ONCE AGAIN HAS BEEN GIVEN BENEFICIAL POLITICAL COVER. THE S.E.C. HAS BANNED FLASH TRADING, NOW THAT THE KING OF SUCH COMPUTER TRADING HAS BEEN CAUGHT WITH ITS ULTIMATE INSIDER TRADING SOFTWARE TOOL. IT IS DESIGNED TO FRONT-RUN THE N.Y.S.E. STOCK MARKET AND USES FLASH. IF GSAX CANNOT USE IT EXCLUSIVELY, THEN NOBODY WILL BE PERMITTED TO USE IT. $$$

As subscriber SteveK from Nevada said, "Do not kid yourself. There is only one reason why ‘Flash' trading is being stopped. Because GSax lost its hold on the operation. Now that anyone can figure it out, it serves no purpose. So if GS cannot have total control of the market, then no one can. Additionally GS can simply say they did not think it was illegal, so no need to punish us. I would expect this to go the way of all the other crapp that has destroyed whatever honesty was still in the markets. It will be glossed over and the need to preserve GS as worldwide banker will be saved."

Another subscriber BobO from Kansas said, "Did GSax have NY Senator Schumer intercede with the SEC to have the practice banned? I just cannot see him doing anything that would do damage to the big Wall Street firms he represents. All at once, he is in the media calling for fair markets, for the SEC to do away with computer speed trading. Besides, it was nothing more than computerized ‘front-running.' The SEC couldn't see that? The SEC should have been the one going to Congress to request they close the loop-hole that made it legal, not the other way around. If a legal loophole existed before the Schumer request, then on what legal grounds did they outlaw it? I think we have been played again."

The Lake County Examiner did a great job in describing the prima facie of the Flash program. Its algorithms according to Pulse2 are "a part of a high frequency trading platform software used to buy stock within a few milliseconds of company news being released and then selling a few moments later when other companies receive the news." This tool would afford Goldman a notable advantage over their competitors and the public. A bail hearing transcript containing prosecutor comments implied that Goldman Sachs has used this program to manipulate the market. The mainstream media has never mentioned the manipulation theme. One week before the story broke out, GSax managed to have its name removed from a list on the NYSE weekly report for most active trading, week ending 26 June 2009. Oil fell 10.5% from $71.06 to $64.05 per barrel right before the July 4th holiday, when usually very light trading occurs. The story broke immediately afterwards. See the Lake County article (CLICK HERE).

◄$$$ GOLDMAN SACHS STANDS AT RISK OF INSTANT DEATH FROM FROM F.A.S.B. RULE REVERSION. THEREFORE IT IS UNLIKELY. LOOK FOR COZY RULE EXTENSION DEEP INTO 2010. $$$ Somehow, Goldman Sachs manages to skate over thin ice and weather the worst of storms. They are indeed privileged. Their extreme leverage of credit to assets lies over 100:1 ratio, as reported in past reports. But they benefit from front running the stock market, from knowing USGovt financial policies, from being first in line for AIG contract redemption, and from sudden reclassification as a bank, no longer an investment bank. A closer look at their balance sheet reveals its Level 3 treatment of derivatives. Level 3 is the category banks use for assets deemed difficult to value in untradeable markets lacking liquidity, hence WORTHLESS. At the end of June, GSax reported $15 billion in credit derivative contracts classified as Level 3. In aggregate, such lowest quality derivatives accounted for 27% of the $54 billion in Level 3 assets at Goldman in 2Q2009. The deeply impaired Level 3 derivative contracts held by Goldman in large volume are suffering losses. That is a lot of garbage on their books!

The trend has turned against them. Start in chronological order. In 2007, their Level 3 derivatives posted an impressive net unrealized gain of $4.5 billion. In 2008, their Level 3 derivatives posted a net unrealized gain of $5.58 billion. In 1Q2009, Goldman reported a net unrealized gain of $975 million on its Level 3 derivative contracts, due to what they called ‘increases in commodities prices and changes in credit spreads corroborated by trading activity.' In 2Q2009, Goldman reported a net unrealized loss of $1.4 billion on its Level 3 derivatives (those acidic instruments ). The syndicate firm blamed the loss on ‘tighter credit spreads on the underlying instruments.' Note the harsh painful costly reversal of what had been a positive trend at Goldman Sachs. My view is that GSax benefited from what is now called widely their "stupendously prescient bet against mortgages" in 2007, but they have no follow-up second act. They very likely have hidden their cratered assets as long as possible, and they are seeping to the surface. Some analysts speculate with a held belief that Goldman Sachs might suffer an instant death experience if they are forced to bring all their dead assets to the front window on the balance sheet. Watch the battle to extend the Financial Accounting Standards Board (FASB) rules past December 2009. See the Reuters Blog Commentaries (CLICK HERE).

◄$$$ HALLIBURTON CONTINUES TO FLEECE THE USGOVT. $$$ Kellogg Brown & Root (KBR) is a division of Halliburton. The Commission on Wartime Contracting has cited the Iraqi War contractor KBR again for resisting USGovt oversight, and failing to cut costs on superfluous support work. The KBR internal accounting and cost estimating systems have been cited as inadequate since 2005, leading to questionable billings and drawn out arguments with federal auditors over hundreds of million$ in charges. KBR has been unable to come up with solutions that satisfy the agency, unlike other large contractors such as Dyncorp International. KBR is the primary support contractor in Iraq, providing troops with essential services, including housing, meals, mail delivery, and laundry. The company has been paid more than $32 billion since 2001, often with ballooned cost markups. Accusations swirl over poorly defined work orders, inadequate oversight, and contractor inefficiency. The planned reduction of KBR personnel in Iraq is declining more slowly than others. Commissioners also faulted KBR for building a $30 million dining facility at a US base in Iraq shortly after the existing mess hall at the base was upgraded at a cost of $3.36 million. The tragic fact is that KBR does what it wishes on construction and support, and charges what it wants, and receives all it demands from the USGovt, and operates with total impunity on fraud and overcharges, only to continue to be paid whatever it demands, as it moves to the next fraud. It is a slush fund run by Cheney. War is good business, especially for the ex-VP Cheney contractor war business model hailed as such a success. It is just another platform for deep fraud. Halliburton is indeed privileged. See the Yahoo Finance article (CLICK HERE).

Then again, don't be too hasty in heaping praise. Many contractors are fleecing wildly in Iraq General Theater. A Defense Dept auditor testified last week that DynCorp Intl billed the USGovt $50 million more than the amount specified in a contract to provide dining facilities and living quarters for military personnel in Kuwait. Fraud might be the norm. See the Washington Post article (CLICK HERE).